Daily Archives: January 12, 2015

Will Bitcoin END THE FED? | Stephen Macaskill (Part 2)
This is part 2, start with part 1: http://bit.ly/PART--1 IN PART 2: - Bitcoin to end the Federal Reserve? 0:00 - Does Bitcoin have intrinsic value? 2:35 - How much gold, silver, and...

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Will Bitcoin END THE FED? | Stephen Macaskill (Part 2) - Video

Summary:The Bitcoin exchange is open for business, but extra security processes are now firmly in place.

Hacked digital currency exchange Bitstamp has reopened for business following the theft of 19,000 Bitcoins.

The Bitcoin exchange suspended services last week following a security breach which relieved the company of over $5 million in digital currency. Following the closure of once-dominant Bitcoin exchange Mt. Gox in 2013, Bitstamp climbed the ranks to become one of the largest online exchanges in the industry -- and many users began to panic after the firm suddenly suspended trading on January 5.

The day previously, some of Bitstamp's operational wallets were compromised, resulting in the loss of roughly 19,000 BTC. To err on the side of caution, Bitstamp warned its traders to stop making deposits to previously issued deposit addresses, and temporarily suspended services to investigate the theft.

The breach represented a "small fraction of Bitstamp's total bitcoin reserves," according to the executive. Bitstamp maintains that the vast majority of bitcoin held is securely stored in "cold" rather than "hot" wallets --in other words, held offline rather than online to prevent hackers from accessing all customer deposits in the case of a security failure. Bitstamp says that any bitcoins held with the company prior to the service suspension are safe and will be honored.

Bitstamp is now back online, and in a statement on its website Bitstamp CEO Nejc Kodric said the firm is "better than ever."

Addressing the company's customers, Kodric said Bitstamp's security protocols have been revamped, including a newly-deployed website and safer backend systems. The company chose to take itself offline after the security breach in order to rebuild systems from the ground up from a secure backup.

"By redeploying our system from a secure backup onto entirely new hardware, we were able to preserve the evidence for a full forensic investigation of the crime," Kodric says.

"We have also taken this time to implement a number of new security measures and protocols so that customers can resume using Bitstamp with full confidence and trust. While this decision means we have not been able to provide you with services for a number of days, we feel this extra measure of precaution was in the best interest of our customers."

Bitstamp has introduced a number of new security features and upgrades. The company has introduced BitGo multi-sig technology, a completely new hardware infrastructure, and has moved its service to Amazon's AWS cloud infrastructure.

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Bitstamp exchange reopens doors after $5m hack

Digital currency Bitcoin has started 2015 on a downward value trajectory, with the currency worth less than a third of what it was a year ago.

The depressed value of Bitcoin follows the hackof the world's third-busiest exchange for the crypto currency, Bitstamp, earlier this month.

Bitstamp said "less than 19,000" BTC were stolen in the raid, which led to a temporary trading halt at the exchange.

The value of the stolen Bitcoin is estimated at A$6.2 million. If the exchange rate continues to drop it could become less than that, as the unknown hackers attempt to swap their Bitcoin for conventional currency.

The digital currency spiked in value in November and December 2014, hitting exchange rates of over US$1100 (A$1356) per Bitcoin.

Since then, Bitcoin value has slid from around US$800-900 a year ago to just US$271,according to the Winklevoss' brothers Winkdex index.

While the Bitstamp raid is sizeable, by comparison it dwarfs the amount of Bitcoin that disappeared from what was the world's largest exchange, MtGox in Tokyo, Japan.

Around 850,000 BTC went astray at MtGox last year.

Although the disappearance of the Bitcoin at MtGox was first blamed on a large scale hack, a Japanese police investigation this month found that merely one percent of BTC were stolen by outsiders, Yomiori Shimbun reported.

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Bitcoin value continues to decline